One of the most difficult problems in bringing back manufacturing from offshore to \u201cReshoring\u201d in the United States is the increasingly stringent environmental regulations being imposed at Federal and State level that adversely affect various sectors of the manufacturing industry.\u00a0\u00a0 The following describes some of the more stringent environmental regulations.<\/p>\n
Clean Water<\/strong>:\u00a0 As authorized by the Clean Water Act in 1972, the federal Environmental Protection Agency (EPA) oversees the National Pollutant Discharge Elimination System (NPDES) Regulations for Storm Water Discharges.\u00a0 In most cases, the NPDES program is administered by authorized states.\u00a0 Many states, such as California, have set up multiple water quality control regional boards that develop and administer specific regulations for their region.\u00a0 The San Diego regional board issued 62 pages of new regulations in August 2002, for which compliance has been very onerous and expensive for manufacturers.\u00a0 For example, rain water falling on a manufacturer\u2019s parking lot must be monitored so that toxic pollutants, oil grease, waxes, chemicals, and visible floating materials are prevented from entering the storm drains on the property connecting to the municipal sewer system.<\/p>\n Hazardous Air Pollutants<\/strong>:\u00a0 In 2005, the Federal Occupational Safety and Health Administration (OSHA) proposed standards to go in effect January 1st<\/sup> 2006, but Congress didn\u2019t approve the new standards as stringently written.\u00a0 The proposed standards would have reduced the allowed emissions for hexavalent chromium (a chemical compound used in the chrome plating process) to less than 1\/50th <\/sup>of the allowable level (52 mg. of chromium per meter of air down to 1mg.)\u00a0 The emission standard of 52 mg. that went into effect in 1998 was already a 97 percent reduction in hexavalent chromium emissions. \u00a0In May 2006, Congress finally approved slightly less stringent regulation of 5 mg. per cubic meter of air, which went in effect January 2007.<\/p>\n Metal plating, including chrome plating, is important to the electronics, machine equipment, defense, and automotive after-market sectors of manufacturing because every metal part that could corrode is nickel or chrome plated to keep it from corroding.\u00a0 These new standards required existing chrome plating facilities to purchase new environmental control equipment in order to maintain compliance status.\u00a0 Many large plating facilities converted to the more expensive, but less toxic trivalent chromium, which is suitable for some applications and certain thicknesses of plating.\u00a0 The trivalent chromium process requires more careful control than the hexavalent chromium process and is more difficult to do in some applications such as barrel plating.<\/p>\n On June 12, 2008, the EPA issued final national air toxics standard for smaller-emitting sources in the plating and polishing industry applicable to cadmium, nickel, lead, manganese, and chromium.\u00a0 The final rule affected an estimated 2,900 existing planting and polishing facilities.\u00a0 These standards seriously affected the chrome plating industry nationwide and have accelerated the offshore outsourcing of products requiring chrome plating.<\/p>\n In San Diego County, six metal processors went out of business between 2007 and 2008, and one Clean Air<\/strong>:\u00a0 In September 2006, the federal EPA approved new national air quality standards that reduced the previous daily particulate matter standard by nearly 50 percent.\u00a0 Particulate matter is fine particles such as soot, dust, and liquid droplets that are too small to see.\u00a0 A new Maximum Achievable Control Technology (MACT) for hazardous waste combustors (boilers and incinerators) followed in 2008.\u00a0 EPA will soon announce new draft rules aimed at slashing toxic air pollution emitted by power plants.<\/p>\n Electric utilities and manufacturers have objected to these new air quality regulations, saying that the new rules cost billions of dollars to implement.\u00a0 William O\u2019Keefe,<\/a> CEO, George Marshall Institute, wrote \u201c\u2026the utility MACT will impose costs on utilities that far exceed air quality benefits\u2026Forcing the utility industry to install the most expensive emissions reduction technologies will simply drive up the cost of electric power when it can least be afforded\u2026That is not what we need as our economy struggles to recover from the worst recession in decades.\u201d<\/p>\n A report released in 2007 by the National Association of Manufacturers\u00a0 (NAM) stated \u201cthe domestic environment for manufacturers is dominated by concerns about rising external costs that make manufacturing from a U. S. base difficult.\u00a0 These costs for corporate taxes, health care and pensions, regulation, natural gas, and tort litigation add more than 30 percent to manufacturers\u2019 costs.\u201d In addition, the NAM report stated that the annual cost of complying with federal regulations is more than $10,000 per employee for manufacturers, while the cost is half that for non-manufacturers.\u00a0 When companies are spending more money on regulatory compliance, materials, fuel <\/ins>and <\/ins>energy, <\/span> they have less money for R & D, new product development, and purchase of capital equipment and systems.\u00a0 This puts U. S. manufacturers at a substantial disadvantage compared to manufacturers in countries that aren\u2019t subject to this degree of regulation.<\/p>\n On October 14, 2010, Joe Barton, Ranking Member of the Committee on Energy and Commerce and Michael Burgess, Ranking Member of the Subcommittee on Oversight and Investigations, wrote a letter to Lisa Jackson, Administrator of the U. S. Environment Protection Agency, expressing their concern over the cumulative impacts of new regulations being proposed by the EPA under the Clean Air Act (CAA).\u00a0 The letter included a chart (51 pages), which identified approximately 40 proposed or final CAA regulations, including greenhouse gas regulations, revised air quality standards, and other regulator proposals under the CAA, as well as many regulations in the pre-proposal stages.\u00a0\u00a0 The letter stated, \u201cAt least eight of the proposed or final rules included have compliance costs estimated by EPA to exceed $1 billion each.\u00a0 It appears that collectively the Administration\u2019s new or proposed CAA regulations could impose billions of dollars of additional new costs annually on U. S. business as the new rules are implemented by your agency.\u201d\u00a0 A response was requested with regard to the accuracy of the compliance costs estimated included in the chart and if there were any other pending or proposed CAA regulations not included in the chart.<\/p>\n One of the unintended consequences of strict environmental protection laws and regulations in the United States that drives manufacturing offshore is the increased environmental pollution in other countries, such as China and India.\u00a0 India and China have been getting more polluted in the last 30 years, as more and more U.S. manufacturing companies have outsourced to these countries.\u00a0 Four cities in India and six cities in China are listed in the \u201cDirty 30\u201d list of the worst polluted sites in the world, according to a 2007 report by the New York-based Blacksmith Institute<\/a>.\u00a0 The Institute\u2019s \u201cTop 10\u201d list now includes four cities in China and two in India.\u00a0 The Institute\u2019s list is based on scoring criteria devised by an international panel that includes researchers from Johns Hopkins University, Harvard University, and Mt. Sinai Hospital in assessments of more than 400 polluted sites.\u00a0 \u201cChildren are sick and dying in these polluted places, and it\u2019s not rocket science to fix them,\u201d said Richard Fuller, Blacksmith Institute\u2019s founder and director.\u00a0 The Institute highlights the health threats to children from industrial pollution, such as the stunting effect of lead poisoning on intellectual development.\u00a0 Some 12 million people are affected in the top ten sites, according to the report.<\/p>\n <\/del> company closed down its chrome plating line prior to the stricter regulations going into effect.\u00a0 Two companies moved their chrome plating across the border to Tijuana, Mexico so that there are now only two metal processors that do chrome plating, which has stretched lead times for locally <\/del> <\/del>fabricated metal parts that require chrome plating.\u00a0 Of course, there is no border control for the flow of air so emissions in Tijuana affect the air quality in San Diego County.<\/p>\n<\/del><\/p>\n